BM-205: Financial Management
OBJECTIVE:
To acquaint the students with the basic concepts of financial management.
UNIT I
Financial Management- An Overview
Nature of Finance Function- Finance and related disciplines, Scope of Financial Management- Traditional approach and Modem approach-Changing role of Financial Manager-Financial Decisions. Objectives of Financial Management-Profit Vs Wealth Maximization, Organization of Finance function
Time Value of Money calculation, basic techniques: Compounding and Discounting; Objectives, calculation. 12 hrs.
UNIT II
Capital Budgeting Decisions
Nature and Significance-Kinds-Cash flows Vs Accounting Profit, Determination of Relevant Cash flow -only under Single Proposal; Evaluation Techniques -Traditional Techniques: ARR, Payback Method, DCF Technique. NPV method, IRK Profitability Index. Capital Budgeting Process. Only Simple Problems to be solved. 12 hrs.
UNIT III
Concept and Measurement of Cost of Capital
Definition and Concepts- Opportunity Cos', Specific and W ACC, Explicit and Implicit Cost. Significance; Measurement of Specific Costs- Debt, Preference Shares. Equity. Retained Earnings, Computation of Overall Cost of Capital Book Value weights. Marginal Weights and Market Value Weights-Problems to be worked out.
12 hrs.
UNIT IV
Financing Decisions
Financial Leverage-Meaning, Measures. Effect on Shareholders return. EBITEPS Analysis
Meaning of Capital Structure; Capital Structure Theories- NI Approach, NOI Approach. Traditional Approach, M-M Hypothesis with taxes -without taxes Factors affecting Capital Structure
12 hrs.
UNIT V
Dividend Decisions
Walters Model, Gordon's Model, M-\f Hypothesis, Dividend Policy Practical Considerations in Dividend Policy-factors affecting dividend policy, Stability of dividends- Significance
12 hrs.
---------
60 hrs.
---------
BOOKS FOR REFERENCE &STUDY
I. Van Home J.C. -Financial Management & Policy
2. Van Horne lc. -Fundamentals of Financial Management
3. Khan M.Y & Jain P.K -Financial Management, Text & Problems
4. Prasanna Chandra -Financial Management. Theory & Practice
5. I.M. Pandey -Financial Management
No comments:
Post a Comment